Nigerian lawmakers urge CBN governor and commercial banks to implement stricter PoS user documentation to reduce fraud, identity theft, and money laundering.
In a move aimed at tackling the growing issue of fraud in financial transactions, the House of Representatives has directed its Committees on Digital and Electronic Banking, Finance, Banking Regulations, and Financial Crimes to invite key banking officials for a thorough investigation into measures addressing fraudulent Point of Sale (PoS) transactions.
The House has called on the Governor of the Central Bank of Nigeria (CBN), Olayemi Cardoso, and the managing directors of commercial banks to appear before the committees and explain the actions being taken to prevent fraudulent activities linked to undocumented PoS transactions.
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This decision follows a motion presented by John Okafor, a lawmaker who highlighted the risks posed by the lack of proper documentation for PoS users.
Okafor pointed out that fraudulent schemes, including identity theft, unauthorised transactions, and money laundering, have surged due to the absence of verifiable documentation for PoS operators and recipients.
The lawmaker emphasised that the absence of due diligence in verifying the identities of PoS users opens the door for criminals to exploit these gaps.
He explained that fraudsters are increasingly taking advantage of the current system, which lacks sufficient checks and balances.
“Without proper documentation, there are glaring vulnerabilities in the system that allow criminals to carry out fraudulent activities, including identity theft and money laundering,” Okafor said. “We must act now to protect Nigerians from these threats.”
Okafor urged the implementation of stronger verification processes, citing that robust identity checks would not only deter fraud but also align Nigeria’s financial system with international standards, including Anti-Money Laundering (AML) and Know Your Customer (KYC) regulations.
He stressed that enforcing the documentation of PoS users and recipients’ identities would enhance transparency, improve accountability, and ensure compliance with national and global financial regulatory frameworks.
According to Okafor, stronger identity verification would bolster trust in Nigeria’s cashless transaction system, which has seen rapid growth in recent years.
By ensuring that only legitimate users and recipients participate in PoS transactions, the government could create a safer environment for consumers and businesses alike.
Moreover, the lawmaker believes that proper documentation would significantly reduce the opportunity for financial crimes and enhance the security of transactions, making the financial system more resilient against fraudulent activities.
“The PoS system must be protected from fraud to encourage wider adoption of cashless transactions,” Okafor added. “We must prioritise the implementation of strict identity checks to safeguard the interests of Nigerians.”
As Nigeria moves towards greater digitalisation of its financial system, the need for secure and reliable transaction processes has never been more urgent.
The call for increased documentation and stronger verification measures for PoS transactions marks a crucial step in addressing these concerns and ensuring that the nation’s financial system is better protected from fraud and other illicit activities.
The House of Representatives’ call for action is now set to place pressure on the CBN and commercial banks to implement concrete measures to protect Nigerian consumers and businesses from financial crime, ensuring a more transparent and secure financial environment.
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